The House of Lords has approved potential legislation that would allow charities and community interest companies to convert quickly to charitable incorporated organisations.

In a debate on Tuesday, peers approved the Charitable Incorporated Organisations (Consequential Amendments) Order 2017, which would also provide an appeals process for CICs.

Speaking in the Lords, Lord Ashton of Hyde, parliamentary under-secretary at the Department for Digital, Culture, Media and Sport, said the rest of the legislation, which was introduced in September, would be laid before the house once the order had passed.

CIOs were included in the Charities Act 2006 and were introduced as a new legal structure in 2013 after significant delays. They allow charities to enter into contracts as corporate entities with limited liability for trustees and members.

The new legislation would allow community interest companies and charities with company structures to convert quickly into CIOs from January.

Charities taking up CIO status do not need to register with Companies House and are not subject to company law, but are registered with and regulated by the Charity Commission.

More than 12,500 new CIOs have been registered with the Charity Commission since 2013.

It is expected that the DCMS will produce a response to the order in the coming weeks.